Papua New Guinea-based Oil Search Limited has signed a memorandum of understanding (MOU) with US engineering firm Halliburton (NYSE: HAL) to develop a strategic alliance. Oil Search has described the alliance as “a unique arrangement between an independent operator and a major oil and gas contractor.”
Halliburton subsidiaries Halliburton Overseas Ltd, Kellogg Brown & Root Pty Ltd (KBR) and Halliburton Australia Pty Ltd will offer a range of oil field services relating to Oil Search’s operations in Papua New Guinea, where Oil Search is a major player in the oil and gas exploration and development market.
Halliburton president Dave Lesar recently signed the MOU with Oil Search CEO Peter Botten in Sydney.
“Oil Search can benefit from Halliburton’s global structure, technology and skilled professionals to increase growth both in PNG and other countries. In return for which we get to gain from the long-term relationship and the success of the alliance,” said Mr Lesar.
Mr Botten said: “The scope of activities that can be included under the alliance covers everything from reservoir planning and well construction services to field operations and maintenance and project development. It’s also got the potential to move beyond Papua New Guinea to Oil Search operations in other parts of the world.”
The concept of the alliance developed out of Halliburton’s long participation in Papua New Guinea as a traditional oilfield service provider through its Energy Services Group (ESG). It now encompasses Halliburton’s engineering and construction division (KBR) in a much closer relationship with Oil Search.
Chas Charles, Halliburton ESG vice president for Asia Pacific, said: “The opportunity for both companies arrived because we recognised we could do better working together rather than separately.”
Oil Search Limited is an oil and gas exploration and development company that has been operating in Papua New Guinea since 1929. It is listed on the Australian and Port Moresby Stock Exchanges, and trades in the US through the ADR market. It owns approximately 70% of Papua New Guinea’s oil reserves and over 50% of gas reserves in the Highlands Gas Project. Oil Search recently took over as operator of the country’s producing oil fields from ChevronTexaco and has exploration licences in Western Australia, Yemen and Egypt.
Halliburton, founded in 1919, is a leading supplier of products and services to the petroleum and energy industries. The company serves its customers with a broad range of products and services through its Energy Services Group (ESG) and Engineering and Construction Group (KBR) business segments.